West Texas Intermediate oil slipped to the lowest level this year as manufacturing expanded less than forecast in China and contracted in Europe, bolstering concern that fuel demand will decline.
Futures fell 1.5 percent after data showed China’s manufacturing growth slowed for a second month while factory output declined in the euro area and the U.K. The factory data helped theU.S. dollar strengthen against the British pound and the euro. A stronger dollar curbs the appeal of raw materials to investors.
“Oil is down because of the disappointing manufacturing index data overnight, especially the Chinese number, which shows the country had the smallest of expansions,” said John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund that focuses on energy. “U.K. manufacturing has plunged into contraction, which is going to hurt demand.”
Crude oil for April delivery fell $1.37 to $90.68 a barrel on the New York Mercantile Exchange, the lowest settlement since Dec. 24. Prices dropped 2.6 percent this week. The volume of all futures traded was down 1.5 percent from the 100-day average at 3:10 p.m.
